How profitable a bank is affects its long-term survivability. A bank can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, likely making the bank better able to withstand financial shocks. Losses, on the other hand, lessen a bank's ability to do those things.
On Bankrate's earnings test, Five Star Bank scored 30 out of a possible 30, exceeding the national average of 16.52.
One key measure of a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. The most recent annualized quarterly return on equity for Five Star Bank was 26.20 percent, above the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank recorded net income of $10.2 million on total equity of $79.3 million. The bank had an annualized return on average assets, or ROA, of 2.33 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.14 percent.